Senate Resources Committee Chair Senator Giesel convened the committee May 9 in Juneau to hear testimony on Senate Bill 180, which would repeal a statutory exemption that currently excludes LNG import facilities from the Alaska Public Utilities Regulatory Act and, the bill’s sponsors say, from certain forms of RCA oversight.

The bill is short: “SB 180 is a simple, 1 line bill that would repeal, a section of Alaska statute that currently exempts the import of natural gas from regulation by the RCA,” said Mayo Harbison, staff to Senator Giesel, who opened the technical briefing.

Why it matters: proponents and RCA officials told the committee the statute’s continued existence creates a point of legal uncertainty about whether the commission can review contracts and rates tied to imported LNG. That uncertainty, they said, could be used in court challenges and complicate protection of ratepayers if utilities seek to pass terminal or supply costs to customers.

At the hearing, Dr. Steve Colt of the Alaska Center for Energy and Power walked committee members through the statutory context and two risk scenarios the center examined. Colt described AS 42.05.7(11)(v) — the subsection at issue — as an exemption embedded inside the broader Alaska Public Utilities Regulatory Act that can operate differently depending on the facts of a project. He told the committee he reviewed the RCA’s docket U-25-004 and other briefs and concluded the legal picture is layered and sometimes ambiguous.

RCA Commissioner Steve DeVries said the commission has statutory tools to scrutinize related-party transactions and affiliated dealings, citing AS 42.05.441(c) and AS 42.05.5(11)(c) as authorities the commission currently relies on to review affiliated transactions. DeVries told the committee, “That’s why we think that the passage of this particular bill would help remove that uncertainty,” adding that courts — not the commission — are the ultimate arbiters of jurisdiction.

RCA staff and commissioners also described federal-state jurisdictional limits. DeVries and Chair John Espindola told the committee that the Federal Energy Regulatory Commission (FERC) has exclusive federal authority over the siting, construction and operation of LNG facilities, and that the Hinshaw Amendment applies in interstate commerce scenarios but not to foreign-commerce imports. DeVries noted a practical constraint — the Jones Act and the current lack of U.S.-flag LNG tankers — in evaluating some cross-state import hypotheticals.

Committee members raised practical scenarios. Senator Myers asked whether a terminal built and operated by an entity that also supplies the gas could evade meaningful RCA review; Colt and the RCA said that affiliated-transaction rules and rate-case review are instruments the commission can use, but that the statutory exemption could complicate judicial review later. Senator Kawasaki asked whether leaving the exemption in place would provide ammunition to parties who dispute RCA jurisdiction; DeVries agreed the exemption could be used in court to argue against state oversight.

Other stakeholders were referenced in the hearing record. Colt summarized briefs and arguments from utilities and intervenors, including Chugach Electric and an NSTAR-related docket, that contribute to the record’s range of views on the proper split between FERC and RCA oversight.

No motions or votes were taken at the May 9 meeting. The committee received the testimony and questions; staff and the RCA will be available for further clarification during the interim if the committee requests it.

The committee recessed after the presentation and set its next meeting for May 12, when it will consider unrelated bills on invasive species management and marine debris cleanup.